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NHAI likely to pay Rs 922 crore to private highway operators for toll loss post demonetization

29 Dec 2016 Evaluate

The National Highways Authority of India (NHAI) will pay Rs 922 crore to private highway operators for the toll revenue loss they incurred due to suspension of user charge collection from the afternoon of November 9 to the midnight of December 2, 2016. Toll collection was suspended across all national highways in the country after the Prime Minister Narendra modi’s decision on November 8, to demonetize Rs 500 and Rs 1,000 currency notes from circulation.

NHAI has moved a proposal to compensate private highway operators, to boost the confidence of private investors, give immediate relief to already stressed developers and to provide a safeguard against bank loans becoming nonperforming assets. As per the NHAI proposal, the compensation payment has arisen solely on account of the government decision. Though, the Union Cabinet will take the final call on the ways private sector highway operators could be compensated for their losses on toll collection due to the government’s demonetization move.

The highway authority has worked out the compensation based on the average daily collection in October. It said that this works out to be Rs 1,212 crore for all the 317 toll plazas, revenue loss of projects on public-private partnership (PPP) is estimated around Rs 922 crore. It also said that the balance estimated loss of about Rs 290 crore is in respect of public funded/annuity projects, which vest in NHAI and for which the compensation amount does not have to be paid out. NHAI added that all those operators who take the onetime compensation will execute an agreement with the authority stating that they will forgo any other claim, including that for extension of toll period.


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